Amdocs (DOX) Cut to Sell at Zacks Investment Research

Zacks Investment Research downgraded shares of Amdocs (NASDAQ:DOX) from a hold rating to a sell rating in a research report released on Thursday morning.

According to Zacks, “Amdocs' Q4 results improved year-over-year. However, exposure to foreign currency exchange rate risk is a major concern. A sequential impact of $5 million in foreign currency movements affected the top-line. Moreover, high concentration risk remains a significant challenge. Decline in spending by Amdocs’ largest client — AT&T— is affecting the company. Continued drag in the directory systems market remains a headwind. This downtrend, which has been persistent for the past couple of years, is expected to continue. Shares have underperformed the industry on a year-to-date basis. However, Amdocs' growing client base and portfolio expansion are positives. Its support for Comcast Business’ commercially available software-defined wide area networking service is likely to drive growth.”

Several other analysts have also recently commented on the company. TheStreet cut Amdocs from a b rating to a c+ rating in a research report on Friday, November 9th. JPMorgan Chase & Co. set a $70.00 target price on Amdocs and gave the stock a hold rating in a research report on Tuesday, December 11th. Finally, BidaskClub cut Amdocs from a buy rating to a hold rating in a research report on Wednesday, November 28th. One investment analyst has rated the stock with a sell rating, five have given a hold rating and four have issued a buy rating to the company. The company presently has an average rating of Hold and a consensus price target of $72.28.

DOX opened at $59.56 on Thursday. The firm has a market cap of $8.35 billion, a PE ratio of 15.93, a P/E/G ratio of 1.79 and a beta of 0.51. Amdocs has a fifty-two week low of $58.92 and a fifty-two week high of $71.72.

Amdocs (NASDAQ:DOX) last released its quarterly earnings data on Thursday, November 8th. The technology company reported $0.90 earnings per share for the quarter, missing the consensus estimate of $0.92 by ($0.02). The company had revenue of $1 billion for the quarter, compared to the consensus estimate of $1 billion. Amdocs had a return on equity of 15.06% and a net margin of 8.92%. The business’s revenue was up 2.3% compared to the same quarter last year. During the same period in the prior year, the business earned $0.94 earnings per share. On average, research analysts anticipate that Amdocs will post 3.92 earnings per share for the current year.

The firm also recently announced a quarterly dividend, which will be paid on Friday, January 18th. Stockholders of record on Monday, December 31st will be given a $0.25 dividend. The ex-dividend date is Friday, December 28th. This represents a $1.00 annualized dividend and a dividend yield of 1.68%. Amdocs’s dividend payout ratio (DPR) is presently 26.74%.

Several large investors have recently made changes to their positions in DOX. Nordea Investment Management AB purchased a new stake in shares of Amdocs during the third quarter worth $138,713,000. Janus Henderson Group PLC raised its holdings in shares of Amdocs by 12.0% during the third quarter. Janus Henderson Group PLC now owns 9,409,175 shares of the technology company’s stock worth $620,818,000 after acquiring an additional 1,005,564 shares in the last quarter. OppenheimerFunds Inc. raised its holdings in shares of Amdocs by 23.1% during the third quarter. OppenheimerFunds Inc. now owns 3,716,993 shares of the technology company’s stock worth $245,247,000 after acquiring an additional 697,639 shares in the last quarter. Robeco Institutional Asset Management B.V. raised its holdings in shares of Amdocs by 47.9% during the third quarter. Robeco Institutional Asset Management B.V. now owns 1,417,153 shares of the technology company’s stock worth $93,535,000 after acquiring an additional 459,024 shares in the last quarter. Finally, Standard Life Aberdeen plc raised its holdings in shares of Amdocs by 17.3% during the second quarter. Standard Life Aberdeen plc now owns 2,894,247 shares of the technology company’s stock worth $191,600,000 after acquiring an additional 427,752 shares in the last quarter. Institutional investors and hedge funds own 91.15% of the company’s stock.

Amdocs Company Profile

Amdocs Limited, through its subsidiaries, provides software and services solutions to the communications, entertainment, pay TV, and media industry service providers worldwide. The company offers customer experience and monetization solutions that allow its customers to contextual and personalize interactions.

Further Reading: Return on Investment (ROI) Defined, Explained

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